Market Commentary - Foreign Markets
Japan Nikkei rebounds from one-month low As on : 31-May-24  14:06

Japan share market finished session higher on Friday, 31 May 2024, rebounding from a one-month closing low in the prior session, thanks to bargain buying on recently battered stocks, with shares in Paper & Pulp, Manufacturing and Transportation Equipment sectors led gains.

Investors digested a slew of economic data at home for hints on the Bank of Japan's likely monetary policy path. Japan's industrial output unexpectedly fell in April and the nation's jobless rate was unchanged. Still, Inflation in Tokyo accelerated in May, keeping the Bank of Japan largely on track to consider a rate hike in coming months

At closing bell, the 225-issue Nikkei Stock Average index surged 433.77 points, or 1.14%, to 38,487.90. The broader Topix index of all First Section issues on the Tokyo Stock Exchange advanced 46.29 points, 1.7%, to 2,772.49.

ECONOMIC NEWS: Japan Industrial Production Eases 0.1% In April- Industrial output in Japan was down a seasonally adjusted 0.1% on month in April, the Ministry of Economy, Trade and Industry said on Friday. On a yearly basis, industrial production sank 1.0%. Upon the release of the data, the METI downgraded its assessment of industrial production, saying that it fluctuates indecisively but has weakened. Industries that contributed to the decline included transport equipment, business-oriented machinery and electronics equipment - offset by gains among production machinery, fabricated metals and chemicals. Shipments were up 0.2% on month and down 0.8% on year, while inventories fell 0.5% on month and 2.7% on year. The inventory ratio slumped 1.1% on month and rose 0.1% on year. According to the METI's forecast of industrial production, output is seen higher by 6.9% in Mat and lower by 5.6% in June. Industries contributing to the increase in May include transport equipment, production machinery and electronics equipment. Industries contributing to the decline in June are expected to be production machinery, transport equipment and chemicals.

Japan Unemployment Rate Stable At 2.6% In April - The unemployment rate in Japan came in at a seasonally adjusted 2.6% in April, the Ministry of Communications and Internal Affairs said on Friday. The jobs-to-applicant ratio was 1.26, shy of forecasts for 1.28 - which would have been unchanged. The participation rate was 63.1, topping forecasts for 63.0 and up from 62.8 in the previous month.

Japan's Housing Starts Surge in April 2024- Japan's housing starts rose 13.9% year-on-year in April 2024, reversing a 12.8% fall in March. This marks the first increase since May 2023 and the steepest rise since June 2015. Key gains were seen in rented dwellings, issued homes, and built-for-sale homes. Two-by-four building starts also surged. Meanwhile, new dwellings for owned and pre-fabricated homes fell at slower rates.

CURRENCY NEWS: Japanese yen was steady against greenback on Friday as investors await inflation readings from Europe and U.S. that will likely dictate the path of interest rates globally. The yen was last at 156.80 per dollar.

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